ERIC - Telefonaktiebolaget LM Ericsson reports mixed Q1 earnings; issues Q2 soft guidance

April, 18 2023 01:42 AM Ericsson

2023-04-18 01:42:00 ET

Telefonaktiebolaget LM Ericsson press release ( NASDAQ: ERIC ): Q1 GAAP EPS of SEK 0.45 misses by SEK 0.24.
Revenue of SEK 62.6B (+13.6% Y/Y) beats by SEK 1.85B.
Group organic sales were unchanged Y/Y.
Gross margin excluding restructuring charges was 39.8%.
EBITA excluding restructuring charges amounted to SEK 4.8B. EBITA was SEK 3.8B.
Free cash flow before M&A was SEK -8.0B.
Cash flow was impacted by an increase in working capital. Net cash on March 31, 2023, was SEK 13.6B. compared with SEK 23.3B on December 31, 2022.
Outlook: "For Q2, we expect Group EBITA margin to reach mid-single-digit level. We expect a gradual recovery in the second half of 2023, primarily as we expect the inventory adjustments to be completed and our cost reduction activities to start flowing through the P&L.
With the expected recovery by 2024 of the Mobile Networks market, the turnaround of Cloud Software and Services, portfolio adjustments, enhanced R&D productivity, increased IPR revenues and cost reductions, we are on track to reaching the lower end of the long-term EBITA target range of 15-18% by 2024."

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